Even though I have talked about how I avoided college debt, it is a commonly accepted fact that people who are graduating from college are doing so with record levels of debt. The many pressures that college has often forces students to focus entirely on their schooling at the expense of racking up college debt. College debt is not just a mystical number. It is a concrete, real-life value. It doesn’t just disappear with the click of a button. If you have lots of college debt, you may be wondering how to deal with it. Here are the most common ways of dealing with it.
Ways to Deal with College Debt
Avoidance: You can avoid it all you want, but the majority of loans require minimum payments within a year of graduating from college. If you think you can avoid it forever, you can certainly try…but it won’t do you any good. In fact, I am sure that avoiding college debt altogether can leave you facing legal ramifications.
Minimal Payments: I certainly know how it feels to not make as much as you should once you graduate from college. I had a job that paid minimally right after college and I hated every minute of it. (Because my current job is better, I am hoping to keep my day job for a little longer before jumping into early retirement and earning money entirely from my online business.) Having a job that doesn’t pay well can limit what you can put towards your college debt. Paying the minimal payments, however, will not only force you to pay the debt longer, but will make you pay more money in interest.
Aggressive: One way to deal with your college debt is to get aggressive with it. Find ways to attack it with everything you’ve got. Think terminator-style. Find odd jobs, cut coupons, live with your parents, etc. Anything and everything to get rid of this beast. If you see your college debt as an enemy (as I think you should), you will most likely put all your energy into getting rid of it as soon as possible. This is the method of choice because it will get rid of that dirty feeling of owing someone money and save you lots of money in interest. It’s a win-win! By merely looking at it this way (as opposed to giving as little as you can each month), the sacrifices needed to make it happen will be seen as small and insignificant.
Those who learn how to pay off debt successfully are the ones who will move on to financially secure lives. Make college debt a priority right now when you are young and set yourself up with a debt free life.
If you (have) had college debt, how (are) did you deal(ing) with it?
featured image provide by alancleaver_2000 via flickr
I’m amazed at how fast the student loan people found me when I tried to duck out on the debt. That stuff lasts forever, and they’ll get their money back no matter what you do. I finally broke down and paid it off just a year or so ago – only 20 years after the fact.
I try my best to avoid student loans at all cost, but I do have some because of the multiple times I’ve been in school. I pay extra on the one that has the highest interest rate, but I don’t pay more than the minimum on the other because it’s at 1.625% for life!
Fortunately, I never had college debt. But any debt should be finished as aggressively as possible.
Deferred it by going to graduate school and then married someone able/willing to pay it off! I swear I’m not a gold-digger.
I have about $19,000 in student debt. I’m tackling it aggressively! It will be gone by the end of 2013.
We are paying off consumer debt aggressively. When that is done, it is on to the student loan debt. I can’t wait to be free of debt!
I have about $26,000 in student debt. Some is subsidized and some isn’t. I’m going to pay off as much as I can now (mostly the stuff that’s already collecting interest) and then pay off everything after I get out of grad school (which will increase my student debt A LOT, but hopefully it will be worth it). I have no other debt – car payments, credit card, mortgages – so I don’t feel too badly about have so much from college.
My debt was minimal, college in Australia is far less expensive than in the U.S. I wiped it out in a year or two. My wife’s college debt was a substantial, and I paid for that too when we got married. I was happy to wipe it out.
I’m still paying on my college debt eight years after graduating. But I did return to school for a short time and added more debt to my already paid down loan. Sigh. I should be finished paying it off soon!
The stories above in the comments reiterate why I am not going to get a student loan no matter what. I am going to avoid debt like the plague.
I’d say as important, or even more important, than avoiding or minimizing college debt that I’ve learned from reading blog comments is to choose a useful/marketable college major (or if you choose something functionally useless at least pair it with solid work experience). It’s great to have no debt but if you can’t land a job you’re still up a creek!
I don’t have any student loan debt but my husband does (actually, since it’s entirely his and it was accumulated before we got married, I don’t include it in my debt calculations). Now that we’re out of consumer debt, his entire part-time job salary is going towards paying off that debt. It’ll take about 2 years to finish it off but it’ll accomplish two goals: 1)paying it off before we’re 40 and 2)paying it off before our daughter starts college.
We increased our earnings. At 100k there wasn’t any other choice.
I extended all loans to a 25 year repayment plan, then I automatically pay all of the minimum payments. BUT, on top of that, I make large payments every month to the highest interest loans. As I am getting rid of loans, it allows my to pay that much more towards the next one. I should have all my loans paid off in four years.
I was recently talking to someone I know at work about higher education’ she has sixty thousand dollars of student loan debt. I asked here if see thought college should be free and here response was no that it would be a bad idea because than it would lose much of its high regard if it were free. I tend to agree. I don’t know a lot about higher education. I taught myself to type on the computer. Although I believe that some education beyond high school is useful. I believe that society places to much weight on the four year degree. She commented that here husband was working at a retail store and the management was impressed enough with his job performance that they enrolled him in a management training program when they checked their personal records they found that he did not have a college degree so they unenrolled him and at that point he left the company. The Idea was that higher education is the great equalizer as far as socioeconomics go but in many cases today it has become the great unequalizer. Another guy I know used to work for ford motor he told me that he applied for a job as a department head at the plant but he was rejected not because of a lack of ability he was qualified they told him that he did possess the skills and ability to handle the job but he lacked a college degree. We have now created a class structure based on these varying degrees’ high school’ associate’ bachelors’ masters’ or doctorate. Now we have a situation where because of the inflation in higher education costs the likelihood of someone at the middle of the totem pole as far as family income goes has less ability to qualify for and meet the financial qualifications of higher education unless their willing to go deeply into debt or unless their very bright which would mean they could qualify for a scholarship’ what about everybody else. What if the standard for getting that better job becomes not the bachelors but the masters degree this will only increase the inequality even more leaving only the rich and affluent to take advanage of higher education and qualify for all the better jobs. All this system of things does is create even more inequality than we already have. This is anything but a positive development.
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